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Sustainability and Profitability Can Co-Exist – Here’s Why

Published on 19 May 2021 by Penny Whitelaw in Sustainability
Read here why sustainability and profitability are inseparable, how the story behind our why ties into this and why we are here to help.

Sustainability and fashion become more and more often used in one sentence. However, the reality is that the fashion industry is far from sustainable. Fashion is the 7th biggest industry globally that is worth 2.4 trillion dollars. It is also the most polluting industry after oil. Each year, it produces approximately 150 billion garments, 30% of which never sell while 84% end up in the landfill. More precisely, that equates to the creation of more CO2 than the entire aviation and maritime industry combined!

With the global population expected to hit 8.5 billion by 2030 and our overall consumption estimated to increase by 65%, fashion brands are actively looking for innovative ways to increase profits and reduce waste. But how do you really achieve sustainability and profitability at the same time?

Online shopping is both a solution and a problem

One way to increase profit is to sell online. Direct to Consumer Business Models cut out the middle man to maximise the profit margin. One can minimise expenses by selling directly to their customer through a website, for instance. This way, expenses like rent and additional selling margins are reduced or diminished. The larger profit margins that arise from D2C also allow brands to offer their products for a lower price to their customers. And which customer does not love more affordable products?

Online shopping is also gaining popularity amongst citizens as it can be more convenient and save time. Therefore it will not surprise you that Apparel eCommerce is currently worth 360 billion dollars. However, there is a flaw in this method. On average, 40% of apparel sold online ends up as a return. The number one reason? Incorrect fit.

Why the fit problem exists

The 144 billion dollar fit problem is a highly complex issue that negatively impacts the entire value chain. There are a couple of reasons why this happens. First, there are no international sizing standards though we would like to believe there are. In reality, every customer, brand and garment size is unique. That leads to frustration among online shoppers as they face the reoccurring challenge of “what size AM I?”

Customers do not know how to find the right fit

Most of the time customers deal with this problem in either of the two following ways. For instance, to counter the sizing guesswork customers often buy multiple sizes for 1 item and return those that do not fit. That is problematic because it means that each potential customer will most likely return pieces. If you add up all the customers that will return items just because of size, this will show up as a significant profit loss due to returns and also an unnecessary carbon footprint due to shipping, packaging and so on.

The second scenario shows up as potential customers that will abandon the cart completely to mitigate frustration and risk. While these potential customers are mostly invisible, since you can not miss what you do not know, they are profit walking away. In fact 30% of cart abandonment is directly related to the friction around size and fit. Instead of dismissing these potential customers, brands should focus on improving their online customer experiences. Not only does this result in happier returning customers, but healthier customer lifetime values with fewer returns. Sustainability starts with happy customers.

Brands do not know how to create the right fit

The fit problem arises because fashion brands do not have transparency on who their customers are. For instance, brands are often clueless on how the biometrics of their customers translate into the way they design and size their clothes. That results in clothes that do not fit properly and thus also do not sell. Instead, garments produced in bulk from inaccurate garment specs are the industry standard. These clothes are abundant in flaws and fit issues because they have no centralised intelligence. These methods lead to returns, overproduction and waste and are not sustainable for the environment or for profits.

Customers seek sustainability in brands

The fit problem is nothing new. The market, on the other hand, is dramatically different and changing every day. Nowadays, customers seek out brands that contribute to sustainability or support other political views that are important to them. They also demand friction-less shopping experiences with their needs put first. And more than ever before, they are using their wallets to vote for the type of world they want to live in. In short, customers decide which brands are relevant and which are not.

On top of that, buying behaviours have shifted from cognitive decision-making: such as price, product, perks, to a hybrid approach. Emotive decision making is strongly influencing this approach. For illustration: how are you personalising my experiences, what tools make buying from you effortless and most importantly, are our values aligned; can I validate you getting my well earned cash and be proud to be an evangelist for your brand?

The story behind our why

Our mission is to empower responsible consumption and production in the fashion industry (SDG 12). Our vision is to steward the fashion industry towards a more circular economy. We hope that together we can make an equally positive impact on people, profit and our planet. As a purpose-driven fit intelligence company that uses behavioural and data science as its foundation principles, we have taken a completely different approach to solve the fit problem. Our data-driven fit technology removes the guesswork for online shoppers by helping them find their perfect fit for each garment, the very first time.

We provide purpose-driven fit solutions, helping brands and our planet in the process

We are very proud to say that Scircula is the most accurate fit solution in the market, providing 97% accurate garment specific fit recommendations. Besides, the data we collect enables fashion brands to know their customer’s unique body shapes, sizes, buying behaviours and how their garments fit. This not only helps them optimise their customer experiences, which have increased sales by 11% and reduced returns by 34%, but also support more accurate product development and production of garments that fit and sell

Our brand partners are living proof that sustainability and profitability go hand in hand. And they don’t need to do it alone, we here to help fashion brands build a more sustainable and profitable tomorrow. We believe the future does not need to compromise between achieving financial, social or environmental prosperity. We believe we can have it all.

Do you want to save time, money and our planet by building a more profitable and sustainable business? Book a Demo!

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